Key support services market themes for 2017:

Freelance Employees Causing Disruption

Freelancers and network-based employees are disrupting traditional professional service subsectors by offering more tailored knowledge of buyers and providing a more ‘high-touch’ service.

2

Political Headwinds Subsiding

2016 was the year of political upsets. Trump is now well into his presidency, and whilst Brexit is still fraught with uncertainty, it is largely ‘business as usual’ for UK companies operating within the EU. Some believe, though, that Britain's EU extraction may take five or more years.

3

Small Firms Carving Out Strongholds

Whilst the consulting sector is still traditionally dominated by the large firms, inclusive of the Big 4, smaller challengers are gaining momentum by focusing solely on a niche and offering a highly specialised service.

4

Robotics Shaping the Future of Logistics

UPS, DHL and FedEx are all experimenting with robotic loading and unloading of irregular parcels. Improved mapping technologies will allow robots to evaluate packets more accurately, as well as increasing efficient use of space in shipping containers and lorries.

5

Digital Driving New Business Models

Management consultancies are looking to reduce their over-reliance on senior consultants by applying more quantitative analysis and using automation to decrease lead times and increase efficiency.

6

Consolidation Across the Consulting Market

More mature, mid-size, companies are being snapped up by major players in a bid to provide a full suite of services. This is, in turn, making it difficult for mid-size players to compete in a market where scale benefits matter.

7

Low Cost Carriers Disrupting Airline Industry

The airline industry was once clear-cut in its definition of low-cost carriers and full-service carriers. These distinctions continue to be blurred as ultra low-cost carriers take market share from the once dominant full-service carriers. Overall, the industry continues to thrive as global passenger traffic grew 7.9% in H1 2017 over H1 2016 according to IATA.

International M&A trends & market analysis

The following support services sector market data and commentary are produced by our market research team and global support services sector specialists as part of our semi-annual all sectors global report. The data is organised into all support services businesses valued over $5m “All Market” and support services businesses valued in the range $5m to $150m the “Lower-Mid Market”.

Historic valuation trends:The following chart shows international support services sector business valuations over time, based on semi-annually averaged transactional data:

Regional valuation variation:The following chart shows international support services sector business valuations by region, based on listed company multiples as at mid August 2017:

Sub-sector valuation variation:The following chart shows international support services sector business valuations by sub-sector, based on listed company multiples as at mid August 2017: